In Re: Testamentary Trust of Northcraft, L.
In Re: Testamentary Trust of Northcraft, L. No. 1105 WDA 2016
| Pa. Super. Ct. | Mar 9, 2017Background
- Decedent created a noncharitable testamentary trust by will (dated Jan. 22, 1979) funding two parcels of real estate; the will granted a successive right to reside on the premises to her children (by age), then to grandchildren, and on termination the principal was to be distributed per capita to then-living great‑grandchildren.
- Decedent died in 1986; over time trustees were not replaced as required, administration lapsed, and the trust became dysfunctional with the last surviving child (Darrell Northcraft, Appellant) exercising exclusive control of the property since about 2006.
- Appellant petitioned to terminate the trust and to have the property distributed solely to him, arguing the trust’s purpose could not be served and claiming a life‑estate interest entitled him to reimbursement/priority distribution.
- Grandchildren and great‑grandchildren respondents agreed termination was appropriate but sought distribution to the great‑grandchildren (third class) as the will’s Article THIRD provided upon trust termination.
- The Orphans’ Court terminated the trust under 20 Pa.C.S.A. § 7740.2 and ordered distribution to the great‑grandchildren; it concluded the children/grandchildren held only a right to reside (not true life estates) and Appellant was not entitled to reimbursement for a life estate value.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the court should read the entire will to effectuate Decedent’s probable intent and distribute terminated trust property to the sole surviving child | Appellant: Decedent’s overall testamentary scheme favored surviving children (and residuary gave estate to surviving children); she intended benefit to her surviving child rather than skipping to great‑grandchildren | Respondents: Distribution on termination must follow trust’s purpose and dispositive language in Article THIRD; ultimate purpose favors great‑grandchildren | Court: Must distribute consistent with trust purposes under § 7740.2(c); plain trust language contemplates ultimate distribution to great‑grandchildren, so property awarded to them |
| Whether Appellant held a life estate (entitling him to reimbursement) or merely a right to reside | Appellant: Characterizes his interest as a life estate vested in him (or similar) and seeks reimbursement for its value | Respondents: The will grants only a privilege/right to reside with duties and limitations; not a transferable life estate | Court: The instrument granted a right to reside (privilege), not a life estate; no reimbursement for life‑estate value allowed |
Key Cases Cited
- In re Estate of Harrison, 745 A.2d 676 (Pa. Super. 2000) (standard of review for Orphans’ Court findings)
- In re Estate of Luongo, 823 A.2d 942 (Pa. Super. 2003) (Orphans’ Court reversal standard; abuse of discretion)
- In re Estate of Whitley, 50 A.3d 203 (Pa. Super. 2012) (trust termination and distribution principles)
- In re Paxson Trust I, 893 A.2d 99 (Pa. Super. 2006) (when instrument manifests intent to create a life estate and attendant rights/duties)
- Estate of Culig, 134 A.3d 463 (Pa. Super. 2016) (distinguishing a license/right to reside from a life estate)
- Baldesberger v. Baldesberger, 105 A.2d 713 (Pa. 1954) (distinguishing life estate from a mere right to reside)